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Australia set to learn as China lifts South African wool ban

Terry Sim, August 24, 2022

South African wool is one the move again. Image – Cape Wools SA Facebook.

 

 

 

 

 

CHINA yesterday lifted its five-month ban on South African wool imports, and the Australian industry is now determined to learn from the situation that grew from concerns over a Foot and Mouth Disease outbreak.

Cape Wool SA late yesterday announced “with huge relief” that China’s ban on the import of greasy wool from the Republic of South Africa has been lifted with immediate effect.

“This has been verbally conveyed to the DALRRD (Department of Agriculture Land Reform and Rural Development) and the announcement has been posted on the official GACC (China’s General Administration of Customs) website.

“We are equally relieved that it has been lifted without the imposition of any additional conditions,” the Cape Wools SA statement said.

“This means the health certificate we have been using since 2019 is unchanged.”

The 2019 protocols allowed South Africa to store and heat-treat greasy wool at certain temperatures for set periods to inactivate any FMD virus before export to China.

However, despite the South African industry and government going to great lengths to show the country’s full compliance with OIE FMD virus inactivation protocols for wool, China maintained the ban on wool imports since April. The urgency of the situation prompted the preparation of a video showing South Africa’s wool biosecurity protocols that was viewed by “more than 50 Chinese role-players.”

About 70-80 percent of the South African clip is traditionally destined for China and before the first wool sale of the new season on 17 August the cost of lost exports was estimated at R734 million (more than A$62m), according to grower bodies Agri SA and the National Wool Growers’ Association of South Africa.

Two days before the 17 August sale, chief executive officer of Cape Wools SA, the official industry representative organisation of the South African wool industry, said the situation was “beyond critical.”

Cape Wool SA CEO Deon Saayman said the brokers would start running out of storage space soon and all the communal wool will soon start coming in.

“More than 40,000 communal farmers’ livelihood depends on their wool income, which China is the sole market for.

“Buyers will not be able to continue funding the purchase of wool indefinitely, which they cannot ship to China, which will have dire consequences for the industry and farmers across the board, including the secondary sector beyond the farm gate,” he said.

“Australia definitely needs to sit up and take notice of how the situation has evolved in South Africa, in spite of the full compliance with OIE inactivation protocols.

“Do not assume that everyone involved in import clearance understands all international protocols and agreements previously reached between importing and exporting countries,” Mr Saayman said.

On what Australia could be working on to potentially avoid facing a similar situation should FMD reach Australia from Indonesia, Mr Saayman said: “Make sure you have measures in place and that it is defendable – full traceability is key.”

“The video, letters from all government departments, the SA Ambassador in China, Our Ministers of Agriculture and Trade and Industry all assisted in trying to put our position across.

“The ban of movement on cattle also helped,” Mr Saayman said.

He said interest and storage costs accrued during the ban cannot be recouped, as well as decrease in market prices.

“But wool can now be shipped, should vessels and containers be sufficient, but the lifting is just in time for the communal wool farmers.”

In a statement on 12 August, Cape Wool SA said during a meeting with the South African ambassador in Beijing and the director general of the Chinese Ministry of Foreign Affairs (MOFA) to clarify the FMD protocols, the MOFA to assist in scheduling a meeting between GACC and the SA mission to further emphasis the 2019 FMD protocols.

“During the above meeting it also emerged that GACC officials, possibly due to a change or personnel, were not fully aware of the details of the 2019 agreement.

“Additional information has also been forwarded to the GACC, via DALRRD, to try to ensure there is a comprehensive understanding of the FMD export protocols,” Cape Wool SA said.

Australia can learn from South Africa’s experience

Executive director of the Australian Council of Wool Exporters and Processors, Peter Morgan, said South Africa’s experience needed to be carefully examined by the Australian industry.

“We are really pleased for the greater wool industry that this impasse has been worked out.

“Australia is certainly continuing to watch what is happening in South Africa and China on this matter.”

He said the issue would be discussed by ACWEP at its annual general meeting during Wool Week in Melbourne this week.

Mr Morgan said he personally believed the Australian industry had to do everything it can “so that if something happens we’ve already done the homework.”

“Wool is different to meat, because we can heat treat it and we can store it in bales and in containers.”

WoolProducers Australia general manager Adam Dawes said the peak grower body had been talking with South African industry representatives about the country’s FMD protocols since March this year, to learn some lessons and share their experiences when access to China was lost in 2019.

He said discussions about the protocols have continued and he put a proposal to the International Wool Textile Organisation Biosecurity Working Group in June to develop a protocol for responding to an animal disease outbreak over the next 6-9 months.

“So a working group has been formed and we will start to progress that – the South Africans, us, the New Zealanders, the Uruguayans are keen as well – led by WoolProducers.”

Mr Dawes said Australia could learn from the pretext under which the South African wool industry’s access to China was reinstated.

Communal wool producers at risk from ban

Earlier this month, SA farmer bodies Agri SA and the National Wool Growers’ Association of South Africa said the value of the South Africa wool clip is around R5billion (A$425m) per annum. The ban also threatened the livelihoods of the industry’s 35,000 workers as well as 4500 seasonal sheep shearers and wool handlers, they said.

The bodies said the ban was unwarranted since South Africa had protocols in place that regulate the storage of wool after shearing for a specified time at required minimum temperatures as stipulated by the terrestrial code of the World Organisation of Animal Health (WOAH). These measures were negotiated with Chinese Authorities during the 2019 FMD outbreak to limit the disruption to trade in circumstances such as the current one.

All export facilities in South Africa have also been registered with the Chinese authorities to ensure proper monitoring and accurate certification. Furthermore, though wool sheep are, like all cloven-hoofed animals, susceptible to be infected by FMD, no outbreaks have been recorded in recognised wool-producing areas and nor have any small stock been diagnosed with FMD, Agri SA and NWGA said.

Agri SA executive director Christo van der Rheede and NWGA CEO Leon de Beer said more than 40,000 small scale producers market close to six million kg of wool annually valued at an estimated R300 million (A$25.5m).

“These producers and surrounding communities will fall back into poverty should the Chinese market remain closed for wool from South Africa.”

 

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